The United States had wanted to limit aid to Kosovo -- excluding the rest of Yugoslavia -- as long as Yugoslav President Slobodan Milosevic remained in power. But the communique requires consensus from the members of the Group of Eight, and Russia blocked the exclusionary language.

Still, German Chancellor Gerhard Schroeder said the G-8 opposed funds for reconstruction until Yugoslavia dumps Milosevic and endorses democracy. He made a distinction between reconstruction aid and humanitarian aid, however.

"Reconstruction aid, re-establishment of economic structures and reincorporation into Europe need democratization, and that is not possible with Milosevic," said Schroeder, who said he would convene a conference in the Balkans for the economic powers to discuss their stabilization plan.

Schroeder said that humanitarian aid -- which could include money to restart power plants to provide heat and water to Yugoslav citizens -- would not be denied to Serbs because of the actions of their president.

Milosevic, president of Yugoslavia since 1987, has been indicted on charges of war crimes by the international tribunal.

Milosevic ordered Yugoslav troops into Kosovo last year to put down an uprising by the separatist Kosovo Liberation Army. Amid allegations of an "ethnic cleansing" policy in the province, NATO launched a relentless air campaign against Yugoslavia in March.

The bombing stopped June 10, when Russia helped broker an agreement with Milosevic to withdraw his troops. NATO formally halted the air war Sunday, when the last Yugoslav troops left Kosovo.

Yelstin: 'Among my friends'

Russian President Boris Yeltsin arrived in Cologne on Sunday for the final day of the three-day summit. Prime Minister Sergei Stepashin represented Russia on Friday and Saturday.

Yeltsin declared he was "among my friends now," despite hard feelings between the West and Russia over Kosovo.

Yeltsin and his wife Naina arrive in Cologne on Sunday

"The most important thing is to mend ties after a fight," said the president, who later met with U.S. President Bill Clinton for the first time since the NATO bombing campaign.

Clinton and Yeltsin used the meeting to smooth relations roughed up by the Kosovo conflict, and to discuss weapons reduction.

The Kosovo crisis dominated the previously scheduled G-8 summit, but the economic leaders managed to deal with several other issues in their final communique. Among those was an agreement to help Russia deal with crippling Soviet-era debt as long as Moscow remains committed to economic reform.

"Once an (International Monetary Fund) agreement is in place, we encourage the Paris Club (of creditor nations) to act expeditiously to negotiate a debt rescheduling agreement with Russia," the G-8 communique said.

The G-8 also agreed to drop about $90 billion in debt owed by poor countries from its books, and it called for an immediate end to the fighting between India and Pakistan over the Kashmir region in the Himalayas. G-8 leaders also urged the United Nations to call Greece and Turkey to the negotiating table to discuss their ongoing dispute over Cyprus.

Moscow Bureau Chief Jill Dougherty, White House Correspondent John King and Reuters contributed to this report.